Personal traits and trading in an experimental asset market

B-Tier
Journal: Journal of Behavioral and Experimental Economics
Year: 2020
Volume: 86
Issue: C

Authors (2)

Miklánek, Tomáš (not in RePEc) Zajíček, Miroslav

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We study the relationship between personal traits and trading outcomes in continuous double auction asset markets. There are mixed theoretical predictions about this relationship followed by similarly mixed empirical evidence. We examine the correlation of cognitive skills, willingness to speculate, risk attitude, willingness to compete, and overconfidence with trading activity in a very simple experimental market with one asset and no uncertainty about the fundamental value. We build on a market setting very close to the canonical one of Smith, Suchanek and Williams (1988) with a constant fundamental value. We conclude that willingness to speculate is the main driver of trading activity. Willingness to speculate and cognitive skills are the only significant predictors for achieved profits from trading. Our experimental results suggest to elicit and control for these two personal traits even in studies focused on aggregate market outcomes.

Technical Details

RePEc Handle
repec:eee:soceco:v:86:y:2020:i:c:s2214804320300483
Journal Field
Experimental
Author Count
2
Added to Database
2026-01-29